AGY-78 | Corporate Affairs Commission

Full description

The Securities Industry Act, 1970 (Act No 35, 1970) (1), provided for the appointment of a Commissioner of Corporate Affairs who constituted a corporation sole under the corporate name of "Corporate Affairs Commission." On 15 April 1970 the Corporate Affairs Commission came into existence and was responsible for the administration of the Act.(2) The Registrar of Companies was deemed to be the Commissioner for Corporate Affairs until a permanent appointment was officially made (3).

The Companies Office continued to administer the function of company registration until the Securities Industry (Amendment ) Act, 1971 (Act No 11, 1971 transferred responsibility for the administration of the Companies Act, the Business Names Act and the Companies (Transfer of Domicile) Act to the Corporate Affairs Commission. (4) On 1 June 1971 the Office of the Registrar of Companies ceased to exist, the Companies Office was abolished, and the Corporate Affairs Commission came into full operation. (5) The Agency was headed by a Commissioner and two Assistant Commissioners. The four active divisions within the agency were: The Registration Division, The Investigation Division, The Corporate Finance Division and the Legal Division (6).

Two significant Acts received assent early in 1976. The Companies (Amendment) Act 1976 (Act No. 1, 1976) this brought the New South Wales legislation into conformity with the other states participating if the Interstate Corporate Affairs Agreement (7) . The Securities Industry Act, 1976 (Act No. 3, 1976) repealed the Act of 1970 and again introduced uniform legislation with the other states. (8)

The major functions of the Commission in 1977-8 involved registration of companies and business names operating in NSW, receiving, examining, registering and making available to the public documents required to be lodged with the Commission, investigating instances of non-compliance with the Companies, Securities Industry and Business Names Acts, and cases of possible misconduct in relation to corporate activity and the securities industry (9). The Commission was divided into the following divisions: Corporate Finance and Accounting, Legal Division, Investigation Division, and Registration and Documents Division (10).

On 22 December, 1978 the Commonwealth and six States entered into an agreement for the establishment of a co-operative scheme for the administration of laws relating to companies and the regulation of the securities industry. Basic elements of the agreement are as follows:- .

* The establishment of a ministerial council comprising ministers of the Commonwealth and each of the states;
* The establishment of a full-time National Companies and Securities Commission "to have and exercise , subject only to directions from time to time of the Ministerial Council, responsibility for the entire area of policy and administration with respect to company law and the regulation of the securities industry.".(11) ;
* The continuation of existing state administrations which will administer the law to the maximum extent practicable subject to the direction of the National Commission;
* The adoption of a proposal uniformity. (12)

The National Companies and Securities Commission (NCSC) was established by Commonwealth legislation in 1979, and it was planned that the states would pass legislation to acknowledge the role of this body and that other uniform legislation would follow including that for companies, takeovers and the security industry. (13) As a result of the agreement the National Companies and Securities Commission (State Provisions) Act, 1981 [Act No 60, 1981] was passed to enable the National Commission to exercise functions and powers in relation to the regulation of companies and securities under laws of this state. Subsequent legislation included :

* Securities Industry (Application of Laws) Act (Act No. 61) 1981,
* Companies (Acquisition of Shares) (Application of Laws) Act, 1981 (Act No. 62, 1981)
* Companies and Securities (Interpretation and Miscellaneous Provisions ) (Application of Laws) Act, 1981 (Act No. 63, 1981)
* Companies (Application of Laws) Act, 1981 (Act No 122, 1981)

The administrative changes led to the necessity to re-constitute the Commission. The Corporate Affairs Commission Act, 1981 (Act No 64, 1981) appointed three Commissioners for terms of up to seven years. One of the Commissioners was appointed as Chairman by the Governor. (14)

The functions of the Commission were described in 1982 as follows:-
"Registration of companies and business names operating within New South Wales.
Receiving, examining, registering and making available to the public documents required to be lodged with the Commission.
Licensing dealers in securities, investment advisers and representatives of dealers and investment advisers.
Investigating instances of non-compliance with the Companies, Securities Industry Companies (Acquisition of Shares) and Business Names legislation, and cases of possible misconduct in relation to corporate activity and the securities industry.
Acting as delegate of the National Companies and Securities Commission. " (15)

The Corporate Affairs (Amendment) Act, 1987 (Act No. 16, 1987) reconstituted the Commission to consist of a single Commissioner (16) .

The Corporate Affairs Commission continued as a statutory body within Business and Consumer Affairs which was created on 25 May, 1988. (17) The 1988 annual report of Business and Consumer Affairs described the role of the Commission as follows:

"The Commission is responsible for administering the laws which regulate the activities of companies and the securities industry in this State.

"These laws are intended to protect investors funds and promote business confidence and investment.

"Activities of the Commission include:
* Registration of business and company names
* Provision of accurate information to the public about company activities
* Incorporation of companies and community non-profit organisations
* Investigation of complaints about company activities
* Prosecution of corporate criminals
* Warning the public of fraudulent investment schemes
* Encouraging sensible investment and money management
* Licensing dealers and investment advisers
* Registration of prospectuses and trust deeds
* Registration of auditors and liquidators". (18)

The Corporate Affairs Commission was dissolved by the Corporations (New South Wales) Act, 1990 (Act No 83, 1990) and the responsibilities were transferred to the Managing Director of Business and Consumer Affairs. (19) The Corporations Act took effect from 1 January, 1991 (20)


FOOTNOTES
(1) Securities Industry Act, 1970 s. 5
(2) NSW Government Gazette 15 April, 1970 p. 1315
(3) Outline 1970 p.15.
(4) Outline, 1971 p. 33
(5) NSW Government Gazette 28 May, 1971 p. 1756
(6) Outline, 1971 pp.33-4.
(7) Corporate Affairs Commission Annual Report for 1976, p. 11 in NSW Parliamentary Papers 1976-77-78, Volume 5, p. 179
(8) Ibid.
(9) Corporate Affairs Commission Annual Report, 1978 pp.19-25.
(10) NSW Government Directory 1977-8.
National Companies and Securities Commission Agreement, 22 December, 1978, s. 32 . Reproduced as Schedule 1 to the National Companies and Securities Commission (State Provisions) Act 1981.
(12) Corporate Affairs Commission Annual Report for the year ended 31 December, 1979, p. 9 in NSW Parliamentary Papers 1979-1980 Volume 5, p. 317
(13) Ibid.
(14) Corporate Affairs Commission Act, 1981 s. 4
(15) NSW Government Directory, 3rd edition 1982 p. 89
(16) Corporate Affairs Commission Act, 1987. S.5
(17) Business and Consumer Affairs Annual Report for the year ended 30 June, 1988 p. 3.
(18) Ibid. p. 11
(19) Corporations (New South Wales) Act, 1990 s. 96
(20) NSW Government Gazette 24 December, 1990 p. 11457

REFERENCES

(1) "Concise Guide" 2nd Edition. "Cor - Cu ", "Corporate Affairs Commission " p.10
(2) Business and Consumer Affairs Annual Report, 1988.
(3) NSW Government Directory, 1977/8 - 1988.